The company's debt to total assets ratio is 63.75%.
What is Debt to Total Assets Ratio?
The debt to total assets ratio is a financial leverage ratio that compares a company's total debts (current and long-term liabilities) with the total assets. The formula for the ratio is Total Debts/Total Assets x 100.
Data and Calculations:
Current liabilities = $530,000
Long-term liabilities = $1,000,000
Total assets = $2,400,000
Stockholders' equity = $870,000
The company's debt to total assets ratio = Debts/Total assets x 100
= 63.75% ($1,530,000/$2,400,000 x 100)
Thus, the company's debt to total assets ratio is 63.75%.
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